NetSuite & Salesforce: The Dream Team Combo for SaaS Companies

NetSuite Integrations - SaaS

As the makers of the applications that allow users to connect to and use cloud-based internet apps, software-as-a-service (SaaS) companies make sophisticated tools accessible to organizations of all sizes. Globally, the SaaS market is valued at $237.5 billion, with North America making up $104.4 billion of that total. The market is now on track to reach $908.2 billion by 2030.

As SaaS and services companies grow and stake their claim in a huge and expanding marketplace, their own technology needs change. Growing SaaS companies also face issues like increased margin pressure, rising operational costs, tighter capital markets and the need to fill seats in the midst of a skilled labor shortage.

“The SaaS industry is experiencing intensified pressure to enhance profitability margins. The pressure stems from a variety of factors,Cleverbridge points out. “Most notably, rising operational costs, increased competition, and elevated customer expectations.”

For example, customer acquisition costs (CAC) are increasing due to the saturated SaaS market, making it paramount for businesses to optimize their marketing strategies. “The emphasis is not just on acquiring new customers but on retaining existing ones to improve customer lifetime value (CLV),” Cleverbridge adds.

By automating all aspects of the customer acquisition and retention process, Salesforce helps SaaS companies track leads, manage opportunities, provide customer support, manage marketing campaigns and analyze customer data. For these and other reasons, the customer relationship management (CRM) platform tends to be a favorite pick for growing SaaS firms.

NetSuite picks up where Salesforce leaves off by providing a full suite of applications that help SaaS companies of all sizes automate their operations, manage their financials, plan projects, streamline their subscription billing and deferred revenue recognition process, sell online, and generate the necessary reports and dashboards applicable to their everyday roles and permissions along with specific board reporting requirements (among other functions).

When NetSuite and Salesforce are integrated, the magic really begins to happen. When these two powerhouses are working from the same data and towards similar goals, SaaS companies can enhance the customer experience, streamline their operations, beat margin pressure and drive growth.

“Salesforce is a fantastic platform for SaaS companies to integrate with NetSuite,” says Drew Preiner, VP of Sales at Vursor, a NetSuite Alliance Partner. If a SaaS company already has Salesforce in place, Vursor works to understand what's already been built inside of Salesforce and what instance of the software (i.e., Sales Cloud, Service Cloud, Revenue Cloud, etc.) the organization is using.   

“Once we understand that, we'll do the integration mapping to determine what needs to take place between Salesforce and NetSuite,” Preiner explains. “Then, we can map that directly and set everything up using a middleware or iPaaS  tool such as Celigo, Boomi, Workato, Mulesoft and many others."

Building Valuable Synergies

For SaaS companies, the NetSuite-Salesforce integration offers high levels of scalability; supports growing teams and complex projects; and helps future-proof the company’s technology stack. Here’s one example of the integration in action:

  1. Saleforce’s closed-won “opportunities” are fed directly into NetSuite as a sales orders.
  2. Next, NetSuite creates the billing schedules, or the start and end dates of the billing frequency for clients on a SaaS contract.
  3. For a 3-year contract, for example, NetSuite factors in the start date and the end date year-over-year.
  4. Then, NetSuite determines how the revenue will be deferred over that lifecycle, in accordance with ASC 606 accounting standards (e.g., straight line revenue or any complex revenue, fair value formulas, etc.).

“All of this can be structured and configured automatically in NetSuite, which provides massive benefits for the finance department by automating the entire lead to cash process. It also significantly reduces the workload of the finance department by automating the billing process with the click of a button” says Preiner.

For companies that want them, Vursor can also build out additional approval levels in NetSuite. For example, once a closed-won opportunity comes into NetSuite, a common approval level would be invoices to either approve or send out.

In this scenario, the necessary information flows from Salesforce into NetSuite which, in turn, understands the start and end dates of the subscription contract. That information will dictate the deferred revenue schedule for NetSuite to handle within the Advanced Revenue Management (ARM) module.

Aligning Business Requirements to Technical Design

As a top Celigo partner, Vursor offers a range of Celigo certifications in-house. That means Vursor not only implements NetSuite, but can also leverage Celigo to set up the full configuration between Salesforce and NetSuite.

“We also have a lot of experience using entity relationship diagrams, so we can put together the best possible process flows and technical diagrams to showcase the various bidirectional flows between NetSuite and Salesforce,” Preiner explains.

Finally, the Vursor experts who work on the integrations also understand how their work impacts the target systems themselves. So, whether you're pulling data from a system or pushing it into another one, those integrations know exactly how the data is received by the system, what impacts it may have and the related best practices.

“In many cases, technical teams don't have visibility into issues like general ledger (GL) impacts, how fulfillment might be impacted or what’s happening with cash application for deposits,” says Preiner. “We always go the extra mile and ensure good alignment of business requirements to the technical design.”

These are just a few key reasons why SaaS companies should consider integrating their existing Salesforce platforms with NetSuite. Doing so helps eliminate manual tasks, streamlines the billing and revenue recognition process, automates workflows and provides unified data access across the entire organization.